Chinese cars are known for being cheap. Even in comparison with domestic equipment, cars from the Middle Kingdom have almost the same price with comparable quality. And this despite the fact that their cost already includes customs fees and shipping costs.
Production factors
One of the most important production factors affecting the cost of cars is the development of production. Chinese automakers have giant industrial clusters that focus on the production of automotive components and the assembly of cars. Ancillary enterprises are located around these clusters. This allows you to save a lot on logistics and on the delivery of spare parts to assembly shops.
At first, all Chinese manufacturers were engaged in licensed (or unlicensed) assembly of cars popular in Asia, Europe and America. Subsequently, having mastered the technology, they began to develop their own models, thus saving on research and development. Until now, many Chinese enterprises produce slightly modified copies of foreign cars, passing them off as their own.
Many well-known world car manufacturers are investing in the construction of factories in China, in the development of cars specifically for China. Subsequently, these factories begin to produce their own cars or supply other car factories in China with components.
Economic forces
China is a country with a very cheap labor force and the largest working population in the world. The main influx of labor to enterprises is the Chinese countryside. The lion's share of workers' labor has a low degree of mechanization and automation, therefore, in comparison with the labor of workers in developed countries, it has low productivity. In fact, Chinese workers work for food. The pace of production is so high that at lunchtime, people rest right on the floor by the conveyor belt. Obviously, with such a sweatshop, there can be no high quality.
State policy in China is aimed at stimulating industrial production by providing various tax incentives, concessional lending programs, subsidies, etc. In all countries of the world, there is a corruption component in the distribution of tax benefits. In China, corruption is fiercely fought - civil servants noticed in bribes are shot in public, broadcasting the execution process on television.
The entire energy system of China is monopolized and owned by the state. Therefore, the cost of electricity is low - the government deliberately does not overstate it. The same goes for the prices of different fuels. All this leads to the fact that production costs are low and keep car prices at the lowest in the world.
